Patriot/UMWA agreement up for vote Friday

CHARLESTON, W.Va. — Friday’s vote on a new labor agreement could be the next step for Patriot Coal toward an emergence from bankruptcy.

A total of 1,800 UMWA members in West Virginia and Kentucky are eligible to vote on the agreement announced Monday between the union and Patriot. The agreement follows months of active negotiations.

The proposal would supplant a ruling from U.S. Bankruptcy Judge Kathy Surrat-States in St. Louis on May 29.

“I told Patriot management that I could not recommend that our members work under the Judge’s order, and they understood that we would not,” Roberts said in the release. “That understanding enabled us to work out this settlement over the past months since the order came down.”

The union has been protesting Patriot’s bankruptcy filing for months, holding demonstrations in St. Louis, Charleston , Fairmont and other locations. The protests have also been aimed at Arch Coal and Peabody Coal companies, which Roberts and the UMWA contend developed Patriot with the clear intention it would fail and drain off pension and health care obligations.

The agreement restores all but $1 an hour of the wage cuts originally included in the deal. Retirees could be protected by keeping the UMWA 1974 Pension fund. Currently active members would also continue to earn pension credit.

Other stipulations of the agreement:

* Annual wage increases of $0.50 per hour beginning Jan. 1, 2015;
* Elimination of monthly premiums for health care benefits;
* Reducing the annual out-of-pocket maximum for health care benefits by 60 percent, from $4,000 to $1,600;
* Restoration of life insurance benefits, vision care benefits, dental insurance and Accidental Death and Dismemberment insurance;
* Establishment of a Voluntary Employee Benefit Association (VEBA) as the mechanism for paying retiree health care benefits going forward. As part of the settlement, Patriot gave the union a 35-38 percent stake in the company. The VEBA will be funded by initial contributions by Patriot, the sale of the union’s stake, and ongoing royalty payments of $0.20 per ton of coal mined by the company.

Roberts, in explaining the package this week, told union members it wasn’t a great deal for their members or Patriot, but it was far better than he expected when the matter arose.





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